Thursday, September 29, 2011

Free ride for dirty oil, border checks for people. But which is more dangerous?

It's one of those typical injustices of capitalism that money, capital and dirty, earth-destroying, toxic oil products, have more right to cross borders and move around the world than do people - often including people who are trying to flee the impact of toxic oil products or governments who repress their population to protect foreign money and capital. So, we shouldn't expect any different sort of behaviour from the Canadian and American government in relation to their own populations. And that's exactly what they're doing.

As Canada and the US try to push forward with their multi-billion dollar pipeline of liquid death, it seems the US is also trying to find ways to put up fences and surveillance cameras along the 6,400 km border that we share. Why? For national security, of course - which means restricting the movement of people. It's worth noting that the security of the Keystone I pipeline and the rogue oil that passes through its innards is rather less secure than would be the border. In one year of operation the pipeline that was supposed to only have one spill every 7 years had twelve. This high rate of spillage is consistent with the experience of pipelines in Alberta with speculation that dirty tar sands oil is highly corrosive, compared to other forms of oil.

Despite its relatively recent construction, Alberta’s hazardous liquid system had 218 spills greater than 26 gallons per 10,000 miles of pipeline caused by internal corrosion from 2002 to 2010, compared to 13.6 spills greater than 26 gallons per 10,000 miles of pipeline from internal corrosion reported in the United States to PHMSA during that same time period. This rate of spills due to internal corrosion is sixteen times higher in Alberta than in the United States. [page 9]

Of course, it doesn't help that TransCanada, the builders of the pipeline, are apparently willing to use cheap, second rate steel and is petitioning the Canadian government for the right to abrogate existing laws on steel thickness, as well as maximum pressures allowed within the pipe. It has to be said that as a result of past practices, TransCanada have been ordered to dig up whole swathes of pipe for replacement.

TransCanada is digging up 10 sections of a new, $5.2 billion crude oil pipeline, including one in Missouri, after government-ordered tests identified possibly defective steel may have been used in the construction.

And if you think that a couple of people sneaking across the border to sell pot in North Dakota is worth laying on fences, cameras and motion detectors (as opposed to, say, de-criminalizing marijuana) then you ought to lose your mind over the fact that oil leaks in the mid-west drain into the soil, which then sinks into the Ogallala aquifer - an underground sea that provides 30% of the groundwater for US agriculture as well as drinking water to populations stretching from Texas up to South Dakota. The health of millions of people could be directly affected by poisoning this key water source - not to mention the economic impacts. Of course, the Tory government believes people who oppose this "national security" disaster in the making are "extremists", including the Official Opposition, the NDP. This only demonstrates that the no price is too high for Canadian and American workers to pay in order to ensure that the Tories' buddies in the oil industry make fat profits. It doesn't matter of indigenous communities suffer high rates of birth defects downstream from tar sands projects. It doesn't matter if the drinking water of the entire mid-west of the USA is poisoned, ultimately leading to tax payer funded clean-up. And if you think any different, then you are an "extremist". However, spending billions to stop a few people from sneaking across a border that's supposed to have been opened since Free Trade, that's rational.

If you ever had any doubt that the hunt to locate and then kill Osama bin Laden was about anything other than vengeance and demonstrating to the world that Captain USA always gets his man, this latest revelation ought to dispel that. First, it was revealed by the UK Guardian newspaper in July that the CIA used a phoney-NGO vaccination program inside Pakistan to locate bin Laden, the prelude to his execution by US Special Forces. The collateral damage of that ploy are now becoming clear with a major aid agency, Save the Children, being forced to shut down operations inside Pakistan because of suspicion of the involvement of NGOs in the illegal assassination.

Furious aid workers say the CIA's reckless use of aid work as a cover by spy agencies has threatened the safety of genuine aid workers and endangered multimillion-pound programmes to help Pakistan's poor.
Save the Children has 2,000 employees in Pakistan and assisted 7 million people in 2010, half of whom where caught in massive floods while the remainder benefited from long-term development programmes.After the security threat in late July, those activities slowed or juddered to a halt.

Now, there are all sorts of critiques one can make about the role of NGOs in the developing world but it is clear that the callous use of the cover provided by western aid agencies working in Pakistan to carry out a revenge mission of more than dubious legality, which would definitely have an impact on the lives of thousands of children, is not only obscene but a true testament of America's arrogance an inhumanity. After nearly a decade of firing missiles from unmanned aerial vehicles into rural and isolated villages, in order to smash a movement whose roots lie in the desire for liberation from imperialism, it is hardly surprising that they would put the work of thousands of aid workers at risk without nary a thought nor a word of apology afterward.

Of course, all of this was so infuriatingly unnecessary. Having created bin Laden with money and weapons and political support for promoting the move conservative forms of resistance to the Soviet invasion, the Americans subsequently left Afghanistan to tear itself apart as former mujahideen fought over who would rule the poverty-stricken, war torn country. Certainly those warlords were corrupt and brutal but the real problem was that the US only cared about defeating their enemy, the Soviet Union, and not about providing the kind of development resources that would have reduced the kind of scarcity - particularly after the withdrawal of military and financial aid during the resistance - that causes civil wars when combined with heavily armed populations.

If that disillusionment in his former masters wasn't enough, the US war against Iraq in 1991 provided the final proof to bin Laden that the US was no friend of Muslims - unless they were immediately useful (a point worth remembering these days in Libya). It was America's abandonment of Afghanistan after it had served its purpose and its brutal war against Iraq - waged from the Muslim holy land of Saudi Arabia - that created bin Laden the enemy of America. But even this needn't have ended up in the massacre of 9/11, the subsequent war in Afghanistan and the present, dangerous deterioration in relations between the US and Pakistan. After bin Laden declared his jihad against the USA and had organized the first attacks on the US - on US embassies in three countries in 1998 and on the USS Cole, a destroyer anchored off of Yemen in 2000 - the Taliban offered both before and after 9/11 to give up bin Laden for trial but the USA wasn't interested in any sort of negotiations or anything short of absolute surrender.

Wakil Ahmad Muttawakil, Taliban’s last foreign minister, told Al Jazeera in an exclusive interview that his government had made several proposals to the United States to present the al-Qaeda leader, considered the mastermind of the 2001 attacks, for trial for his involvement in plots targeting US facilities during the 1990s.
"Even before the [9/11] attacks, our Islamic Emirate had tried through various proposals to resolve the Osama issue. One such proposal was to set up a three-nation court, or something under the supervision of the Organisation of the Islamic Conference [OIC]," Muttawakil said.
"But the US showed no interest in it. They kept demanding we hand him over, but we had no relations with the US, no agreement of any sort. They did not recognise our government."

And once 9/11 had taken place, war was needed to restore American prestige, even if it ended up killing many dozens of times the number of innocent people as died in the World Trade Center (and, while the war against Iraq clearly had no relation whatsoever to 9/11 it caused the premature deaths of perhaps a million people, compared to the 3,000 who died in New York City). This latest atrocity in the interest of America's imperial prestige, at a time of declining American power, will only add fuel to the fire of anti-Americanism and weaken their position in Pakistan and beyond.

Wednesday, September 28, 2011

As vile and racist as the regime is, you have to give them points for sheer chutzpah. Having denounced the Palestinians at the UN for not being serious about peace, Israeli PM Netanyahu has agreed two days later to build another 1,100 illegal buildings in occupied East Jerusalem. Of course, this has always been the strategy of Israel, ultimately emanating from the ultra-colonialist doctrine of Ze'ev Jabotinsky known as the Iron Wall. Basically, Israel will be so bad ass, so murderous and just plain crazy with a plentitude of American-bought weapons that the Palestinians, the Syrians, the Egyptians - the whole damn planet - will shut the hell up and do what Israel says. Unfortunately for the Palestinians what the state of Israel says is "fuck off and die", which isn't a very good place to start negotiations. And when Netanyahu says that negotiations must start from a perspective of "no preconditions", what he really means is that the only precondition is that the Palestinians will perform the above-noted-act of dispersal.

Unfortunately for Israel, the "we're-too-nuts-to-be-messed-with" line isn't carrying the same weight. Previously, they used the horrors of the Holocaust (which the Palestinians had nothing to do with) to justify their murderous, genocidal behaviour. Increasingly that doesn't hold much water - except with John Baird and the Harper Tories. Now there is no justification, just that they will kill whoever crosses them (and "crossing" them is broadly defined). But the Middle East is changing rapidly and Israel's actions have isolated it internationally, outside of the United States. With Turkey preparing a case against Israel's blockade of Gaza and threatening to escort aid ships with Turkish navy vessels and Egypt's post-revolution Prime Minister openly musing about the end of the peace treaty between Egypt and Israel, Israel is in danger of digging its hold deeper. Nor can it count on the power of the US to unilaterally discipline countries like Turkey, Egypt or even Saudi Arabia. The wave of revolutions have put everything on the table. Hell, the Saudis are even going to let women vote and run for office (well, insofar as anyone can vote or run for any office that has any power). And the rise of a dynamic and wealthy China, which doesn't demand the same fealty to every twist and turn of its foreign policy as the USA and Europe, has undermined America's power as a more attractive ally. The result is that while, in the past, Israel's "fuck you" was accepted, if grudgingly by everyone in the neighbourhood (bar, perhaps, Hezbollah), more and more of the world is replying back "no, fuck you." That will ultimately be to Israel's detriment.

Tuesday, September 27, 2011

I have to say that it's not often that people at the heart of the stock market casino come out and tell the truth about the operation of the system, so kudos to this trader, though it is a remarkably cynical worldview. If he's right that the institutions who run the world - Goldman Sachs and the other big banks, hedge funds, etc - don't give a damn that the crisis that they've generated is going to destroy "the savings of millions of people" I would suggest that we need to vote out these institutions. Oh, that's right - they're not subject to democratic control...

There are so many ways that capitalism is absolutely irrational (not to mention inefficient at allocating resources) - the fact that the USA spends $1 trillion on "defence" while children die from lack of clean drinking around the world (or while growing numbers of American children live in poverty) is one that comes to mind. Or, how about the fact that $4 trillion was spent bailing out US banks that caused the near-meltdown of the global economy because of their barely legal and certainly unethical lending and debt packaging practices. This latter point is worth noting since it is the primary immediate cause of the present round of sovereign debt crises in Europe and the USA.

But those weren't the examples that came immediately to my head when I read this article in the Globe & Mail this morning. It seems that global stock markets are jumping for joy over a European plan to solve the Greek debt crisis. Except that there is no plan. All that European leaders have said is that there will be a plan. I also have a plan to make a million dollars this year and invite you to invest in me, in return you can stay at my mansion any time you like. You think I'm kidding?

Investor sentiment improved after European ministers told a meeting of global finance leaders in Washington over the weekend that they would take bolder and more decisive steps to pull Greece back from the brink of bankruptcy.

This, of course, has been typical behaviour over the last several months as we have gone from the flavour of the week, economy-saving plan to depression over the fact that the plan turns out to be voodoo or politically impossible or politically impossible voodoo (with no offense to voodoo, which has considerably more grounding in science than most economics). The real source of this gyrating sentiment is not the mental health of investors or their automatic betting, I mean investing, programs. The real source is that nobody knows what to do or what will work. Obama preaches stimulus spending. The Republicans preach restraint and austerity. Britain preaches austerity. Leading economists and bankers preach stimulus. Harper, never one to miss and opportunity to show leadership, preaches both austerity and stimulus, depending on whether you lead a government north of Italy or south.

I don't think anyone will accuse me of being a prophet when I say that within a week the stock markets will again be racing for the drain. After all, they have nothing to do with reason, planning or the real economy per se. They are nothing more than a high stakes casino where the odds are rigged against the little guy so that corporations and the rich can have one more way to fleece to mooks and line their profits. Not so different from the lottery, actually. The trouble for the big players is that they are looking increasingly like they might be hoisted on their own greedy petard. And that makes them sad. They won't be happy again until we are forced to pay for their gambling addiction and manic binges of irrational investment priorities.

Baird was the attack dog for the Harper government at the UN yesterday with his meandering rant that read like it was written by the Israeli ministry of international propaganda. Claiming people and nations who didn't support Israel were akin to appeasers of fascism and communism, Baird demanded that Israel's struggle against extremism and terrorism be recognized, along with its struggle to defend its borders.

Huh?

Apparently nobody sent Baird the memo that Israel is illegally occupying other people's land, not the other way around. Nor that Israel has initiated more wars against its neighbours than any other country in the region. In fact, it would be worth pointing out that Israel, as a colonial settler state, constitutes in its majority people who are not indigenous to the region. They have, in other words, taken over someone else's land. This is all in the public record and non-controversial.

Baird knows this, as does Harper and Jason Kenney, who have both been on the trail this week attacking the Palestinian leadership for finally standing up and stating what has been obvious since shortly after the Oslo Accords were signed in 1993 - that negotiations with Israel are pointless appeasement. After all, Israel has accelerated its settlement building project since the Palestinians agreed to a negotiated solution to the Israel occupation, breaking both the spirit of the agreement and the letter of international law. As a result the two-state solution is all but dead as a realistic possibility, with close to half a million Israeli settlers now living in highly developed West Bank suburbs.

The reason for Baird's attack has nothing to do with ignorance and everything to do with playing to the band of Canada's homegrown Republicans. Most of the time foreign policy is a freebie, failing to rouse most Canadians to protest or even change the character of their vote. Harper and his cronies can say the most outlandish stuff, no doubt to many eye rolls and head shakes in the UN, because while the hard right in the Tories laps this stuff up with the Christian right believing that the ultimate domination of Jews over the ancient land of Israel will lead to the Return of Jesus (where he will then dispose of the Jews who fail to convert).

Playing to the Tories motivated, activist base at a time when Harper and Flaherty are intending on being "pragmatic" on government spending is a useful counterbalance to maintaining support where it really counts for the Tories. It's also true that these guys fully understand the important role that Israel plays as a watchdog for imperialism in the region. That role is under threat now more than at any time in Israel's history as a result of the Arab Spring, the mantle of which the Palestinian leadership of Mahmoud Abbas is now trying to seize for its own, rather more moderate ends. For Israel nothing could be worse than democracy in the Arab world. It has only been the restraints of domestic repression that have kept Israel from being utterly isolated in the region where the country is popularly seen for what it is: an invading, colonial regime with a racist disdain for the indigenous Arab population.

In addition to the explosive shifts in regional politics, there has also been the rise of Turkey, with a population the size of Egypt and a fast-growing economy. The US is also seeing a historic decline in its influence as its economic power becomes relatively less important to the global economy and it has damaged its esteem and power of persuasion by its inability to get a handle on Afghanistan, the poorest nation on the planet. The rise of China is aiding this process as an alternative pole for developing nations. All this adds up to make Baird's speech look like the rantings of a cranky old man with a loose grasp on reality. But, then, that describes the core of Tory support so it will have done its job, even as it isolates Canada internationally as being led by extremists and, yes, appeasers.

Friday, September 23, 2011

As Neil Sedaka once crooned "breaking up is hard to do", especially when you're a superpower who needs the help of an unstable and corrupt government to have any chance of defeating an insurgency. It looks like the USA is just beginning to figure out what an ugly break-up between a couple of nuclear powers looks like. And it looks a lot like a high school romance: first there was the infatuation, the gifts, the wooing. But soon big-boy USA was neglecting the needs of its blushing girlfriend, firing missiles into her yard and killing family members in such big numbers that her family - already suspicious of USA's intentions - grew to hate USA, no matter how much money he gave them. Of course, Obama, the "peace candidate" has accelerated the decline in their relationship by ramping up the air strikes inside Pakistan's borders. The unauthorized cross-border raid by US special forces to kill unarmed Osama bin Laden was perhaps the last straw in their dysfunctional relationship. But, like all romances, it doesn't end at the break-up. There's all sorts of entanglements that need to be sorted out and the former lovers need to do some public name-calling of each other, throw around accusations, all that good stuff.

More seriously, it can only be the absolute arrogance of the US empire and its representatives that prevented them from seeing this coming from a mile away. When 9/11 happened back in 2001 the Taliban had already offered to turn over Osama bin Laden for trial - a pledge they repeated after the attacks on New York and Washington. But Bush was determined to wage a war to restore America's honour and the fear-effect - basically sending the message that if you mess with America you will pay the ultimate price. But to wage the War on Terror required regional allies - for resupplying troops, air fields, etc - to strategic and logistical access to land-locked Afghanistan. Problem was that the Taliban were proxies for Pakistan as part of its desire to limit the influence of India upon Pakistan's neighbours. There was also a deep element of Islamism inside Pakistan's ISI (not dissimilar to the Christian fundamentalism at the top of the US military, actually). All of this was well known by anyone who had done any research on the region as presumably the president's military and national security advisors would have done. At the time Pakistan was being governed by a military dictatorship under General Musharraf, which was trying to reduce the power of the Islamists and make the deeply corrupt Pakistani political system less dysfunctional. It was also open to US bribery to turn their backs on the Taliban.

But the US wasn't happy with just overthrowing the Taliban and weren't interested in dealing sensitively with the complex and precarious situation within Pakistan. They were on a crusading mission to crush not just the Taliban but Talibanism - the ideology (which they had helped to create, along with the Saudis, during the war against Soviet involvement in Afghanistan). To do that required crossing the arbitrary and porous Pakistani border into the Pashtun tribal areas where links with Afghanistan were still strong. This unrelenting disrespect for Pakistani sovereignty helped to bring down Musharraf and has kept the present kleptocratic regime in a state of permanent instability. The US - and to some extent Pakistan - may have been able to kill hundreds of guerillas but their actions have helped to create thousands more. And it has made the Islamist elements in the ISI more, not less, amenable to US power in the region. With each insult to Pakistani sovereignty the hostile elements within the ISI - perhaps the whole leadership - have become more emboldened to help the people America was attacking. After all, these guerillas were Pakistanis, fighting for Pakistani honour and would strengthen Pakistan's strategic interests in Afghanistan where Afghan President Hamid Karzai has long made clear his own hostility to Pakistan's role in his country.

All of which brings us back to the US now openly acknowledging that their former high priced partner in the war on terror is, in fact, using American aid to attack American interests. Oops. That's as embarrassing as your girlfriend driving the car you bought her for her birthday through your livingroom window. Only, in this case, the car also had a bomb in it. America - and its allies, like Canada - have only themselves to blame for this debacle. Ten years after going into Afghanistan to extend the power of the American empire into the post-Soviet imperial vacuum, they are weaker, more beleaguered, and have less regional influence than ever before. With the active hostility of Pakistan America and NATO can only lose in Afghanistan. The results of that growing hostility are now on clear display - the attack on the US embassy, the assassination of the chief peace negotiator, former Afghan president Berhanuddin Rabbani. The head of the CIA may try to pretend that these two bold attacks were "a sign of the Taliban's weakness" but it's not likely that anybody besides Fox News will believe him. The NATO intervention can no longer even keep key Afghan government officials safe. Not a great record after ten years of "successes".

I feel like I'm repeating myself, having just written that the global crisis is not a crisis of debt but, rather, that the debt is a symptom of the long term decline in the rate of profit. Now, I read Stephen Harper and British Tory Prime Minister David Cameron blathering on about how "This is not a traditional, cyclical recession, it’s a debt crisis," as Cameron put it. The only logical conclusion, if that is the case, is to attack the deficit. And, sure enough, the prescription that they're offering is precisely that.

[Cameron[ urged action on three fronts:
• Tackle debt and restore credibility and confidence;
• Make it easier to do business and create jobs by freeing up economies;
• Work together to boost world trade, starting with the Doha Round.

The translation of those innocuous words is rather more disastrous than they seem at first glance - austerity, de-regulation and more de-regulation. But, as the saying goes, doing the same thing over and over and expecting different results is a sign of mental health problems. The present expression of the crisis was precisely the result of relying on debt to solve underlying structural problems - many of them the result of declining living standards that arose as either a direct result or side effect of past austerity that saw the chipping away at public services. When public services are cut, working people have to pick up the slack with stagnating or declining wages. They can only do so by going deeper into debt or, following the lead of the banks, by trying to boost income by taking advantage of speculative bubbles, either through various types of investment plans disguised as pensions or by cashing in an illusory increase in equity on their homes. In both cases, the chickens ultimately come home to roost - home prices stop rising as they reach the limits of what people can afford and, ultimately leading to a bursting of the price bubble, which causes more foreclosures, leading to a further price collapse and so on. And their pension plans - both private, corporate and, increasingly even public plans - go into crisis, having bet the farm on speculative bubbles and phoney investment "opportunities" sold by investment banks as collateralized debt obligations and other exotic and impenetrable "financial products" that were really just bags of shit painted with a smiley face on them.
As far as deregulation is concerned, this is precisely what led to the financial crisis in the first place - as banks were able to package and sell garbage as well as themselves investing heavily in this toxic junk. Deregulation of the financial sector led (combined in many districts with previous cuts to taxes on the wealthy) directly to the present high levels of government (aka sovereign) debt. In other areas, deregulation means more Enrons - which combined with other electricity companies to jack up utility prices in California by illegally choking supply - or more Walkertons, where people died as a result of a water treatment system that was privatized to unqualified companies whose only interest was making money. With that kind of record, do you think that we'll be better off if we remove regulations from pharmaceuticals - which already buy positive research results - or nuclear energy (cough, cough, Japan), or the auto industry, or the food processing industry or...
No, at best we'll end up with an economic recovery that is built on more danger and misery for ordinary people as companies produce what they want how they want with no reference to the quality, or safety of their goods. But, more likely the result will be that the Herbert Hoover Re-enactment Society will drive the global economy into a Great Depression Redux. You don't have to be a Marxist to know that smashing consumption at a time when business investment is contracting is about the most stupid thing that you can do. The great lesson of the Great Depression was exactly this: Hoover responded to the onset of the Depression with austerity, making it worse than it had to be. Roosevelt prematurely tried to rein in the deficit in 1937, leading to a steep decline in the economy until the approach of war led the US - and almost everyone other country - to pour resources into re-tooling entire economies towards war production, thus re-inflating consumption.
Ultimately, the lesson from the Great Depression is that the real goal of idiots like Harper was to massively devalue the cost of commodities as a way to restore profits. Unfortunately for the mass of the population the main target of depreciation was wages and working conditions. The elephant in the room is China, with its decades long growth rates approaching (or surpassing) ten percent. Manufacturing is drawn to China like a moth to a backyard bug zapper because of the cheap price of labour, making it the envy of every corporation on the planet. And, for governments in developed countries, unwilling to invest in new infrastructure by raising taxes as an alternative way to compete, the idea of out-sweat-shopping China is appealing. Certainly China's living standards are rising at rates that would make western workers, with their stagnant living standards, drool. But they are rising from such a low rate that even after more than two decades of constant growth - at rates lower than the overall rate of growth, it's worth saying - they are still a fraction of living standards in the west. And that presents a problem not only for western workers who can't compete with such low wage rates. It also presents a problem for western capitalists. If the rise in China's living standards aren't enough to meet those of western societies in time to save their economies, then the living standards of western economies must be depreciated rapidly in order to compete with Chinese labour. This is the real meaning of calls to "boost world trade." They will boost world trade by making goods from the west cheaper and they will be made cheaper by reducing labour costs.
While that seems horrific if you happen to be a member of the working class - i.e. of the majority - it would seem to a blinkered pro-capitalist politician to make a lot of sense. The trouble is, it won't work. It's an unbendable rule in physics that every action creates an equal and opposite reaction. China has a ruling class perhaps more cognizant than most about its long term interests. It is their intention to allow a slow and controlled rise in living standards as their economy approaches "development", rather than being a "developing economy". Their recent acceptance of a rise in their currency is an expression of this goal. But not only will the immediate effect of Harper's & Cameron's austerity recipe increase the possibility of a series of profound financial and economic collapses, they will be met be a reaction from China that will attempt to neuter the effect of a rapid decline of living standards in the west. History never repeats itself exactly but, in this case, austerity must be understood as a trade war by other means.
AFTERWORD:
As a side note, another option to which ruling classes have traditionally turned has been protectionism. At present the dominant thrust - with memories of World War Two, which emanated from protectionist responses to the Great Depression - has been towards austerity and deregulation as an alternative to protectionism; a sort of race to the bottom model. But the protectionist model is also a dangerous game to play and so it is deeply disheartening that the Ontario NDP in the present provincial election has made "Ontario first" a central plank of its job creation platform. First of all, on its own this will have negligible effect. But secondly, it's not the case that a government gets to impose protectionist measures and there is no reaction. Of course the WTO would step in but Ontario gets significant inputs and products from countries around the world and a trade war with a minor economy like Ontario's would be economically and politically devastating. It also suggests that the problem is a regional and not a class one, as though Quebec train manufacturing workers are less deserving of work than Ontario train manufacturing workers. It is fundamentally a politic built upon a passive acceptance of the status quo. It is not left wing at all and has no role for working people - across provincial, let alone national boundaries - struggling together to defend their living standards from the corporate predators and their representatives like Stephen Harper. That is, of course, the perspective of union bureaucrats who would rather the NDP pass meaningless legislation than mobilize their members but it is a disaster for working people.

Thursday, September 22, 2011

Finance Minister Jim Flaherty and Stephen Harper are all over the media attacking European Union politicians for failing to take decisive action to deal with the "debt overhang", particularly in places like Greece, Spain, Portugal and Italy. This failure of political leadership they contend is at the core of the problems facing the world economy.

Mr. Flaherty said a failure to adequately address Greece’s debt problems puts the global economy at risk, sharpening his criticism again as he and other top Canadian officials have in recent days.

This is what you call missing the point. The problem is not the debt it is the undemocratic priority-setting imposed by global financial traders, ratings agencies and businesses. The same people who almost destroyed the economy in 2008 by creating an unregulated shadow banking sector that was little more than a giant ponzi scheme are now demanding the economic priorities of sovereign nations be determined by them. The lunatics are truly running the asylum. Not only has this crew demonstrated that it doesn't have the interests of the economy at heart, rather they are interested in wringing profits out of every pore of a country then moving on to the next. They don't care about investments in productive or socially necessary infrastructure. The determinants of good or bad, efficient and inefficient bear no resemblance to common sense understanding of those terms. It is entirely determined by their accumulation of wealth.

But even that is really just a symptom of deeper problems. In Europe, it is true that Greece and some other countries have high levels of public sector debt. But it is to miss the point entirely - as I've argued more than once - to look only at public sector debt. It is total debt within an economy that shapes the likelihood of whether there will be investment to stave off a recession or protracted stagnation. In the USA the federal government has a debt of $14 trillion. That's a lot, representing about 100% of GDP. But it is dwarfed by the $36 trillion in private sector debt that has ensured that monetary policy - basically pushing down both long and short term interest rates to close to zero - has next to know impact on economic growth. There is literally no room left on the credit cards, lines of credit or mortgages of the nation. The parrot is dead.

And total debt loads themselves are a reflection of the fact that profit rates have been falling almost steadily for the past thirty-five or forty years. In the first instance, the decline in profit rates led governments to embark on an assault on working class living standards that has led to stagnant or declining wages and the de-unionization of the workforce - most spectacularly in the United States where the private sector is basically union free.

And for the first time on record, family incomes are actually falling. New figures this week from the U.S. Census Bureau show that the median income for working-age households fell 10 per cent between 2000 and 2010, even as women worked more hours...
Experts say the seeds of this lost decade were planted long before the recession. Wages fell out of step with rapidly rising productivity and soaring corporate profits in the 1980s, and the gap has been growing wider ever since. The average real wage for working men is now lower than it was in 1973.

But in an economy which is 70% consumer spending, this decline creates a roadblock to further growth. To overcome this workers were encouraged to take on ever more debt. Alan Greenspan kept interest rates low, fuelling speculative bubbles, first in tech then in housing, that gave the illusion of growing incomes. Inevitably, that bubble would burst and leave a wasteland of debt, foreclosed homes and unemployment.

Since the decline in living standards was itself an expression of the problems in the core economy, it is not surprising that debt levels rose across the economy as a whole as profit rates stagnated. In particular, with pressure to move in the direction of a "financialized" economy, debt levels in the financial sector went through the roof. Looking at the graph of US data above you can see that while all levels represented - non-financial business debt, federal government debt, household commercial credit debt - have risen since 1953, they have risen astronomically in the financial services sector, particularly beginning in the early 1970s when profit rates really took a hit. If we look at debt in terms of billions of dollars, as opposed to comparing the change in levels over time, we see in a more pronounced form the very real reason for government debt.

This graph includes financial sector debt, non-financial business sector debt, corporate debt, state & local government debt and federal government debt. As you can see, at the start of Bush Jr's term in office, federal government debt had stopped growing. Bush, of course, slashed taxes for the wealthy and ploughed money into foreign wars, which led to the return to deficit and debt growth. But, even with costly tax breaks to the corporate sector, business debt continued to rise - particularly financial sector debt. Now, look at the grey line around 2010, which indicates the 2008 financial crisis and recession. Notice how financial sector debt declines dramatically while federal government debt skyrockets? What this indicates is that the federal government saved the banking sector from itself by taking on toxic debt. This pattern was repeated in country after country. Those same bankers - who resisted all efforts to regulate them post-2008 (largely successfully) are now howling about the high levels of "sovereign debt."

The upshot is that we are expected to pay for the disaster that they caused with further reductions in our living standards - that's what Flaherty and Harper are going on about: screwing us. The irony, of course, is that smashing Greece's economy into tiny little bits - and doing the same to every other economy upon which they've set their sights - will not solve the problems. They will make them worse. People will need more, not less debt, or they will simply stop spending, causing an economic contraction. They aren't stupid - they know this. The point of the austerity exercise isn't about economic efficiency per se. The hope of people like Flaherty and Harper is that a decisive defeat for workers in Greece and beyond will drive down living standards sufficiently to restore the rate of profit - which, in the graph above, can be seen on a long decline from the mid-1960s. The question is not whether their goal is about making us pay for their crisis. It is whether or not they will be successful.

Wednesday, September 21, 2011

If you're the government and you want to find "gravy" - to pick a random metaphor - that you can eliminate in the provision of services in order to reduce the deficit, what do you do? Why, you hire an auditor of course. An auditor has specially trained staff and expertise in finding "savings" and "non-essential" line items that can be eliminated. Their word and reputation, built up over innumerable clients provide you with an objective measure of what is essential and what isn't. Stephen Harper's Tories are paying $20 million to Deloitte Inc (aka Deloitte Touche Tomatsu Ltd) to review government departments and programs and come up with $4 billion in savings from an $80 billion budget. Deloitte was one of just a few firms that were invited to submit proposals, presumably based upon their past record of impressive results. As Finance Minister Jim Flaherty put it:

“The fact is that we feel we need to have outside advice. It isn’t good, quite frankly, for a government to just look at itself. There’s a lot of expertise in Canada on the subject of public-sector productivity, for example, and we look forward to having the advice of, in this case, Deloitte,” he said.

Well, maybe not quite.

The trouble is, Deloitte has a long string of rather shabby auditing practices. In fact, as late as the end of August a Quebec judge ruled that a class action suit could go ahead in which Deloitte is one of the accounting firms being sued, along with the Mount Real investment company. Mount Real was a ponzi scheme that ripped off unsuspecting investors to the tune of $130 million, including many people's retirement savings. Don't get me wrong, I understand that everyone makes mistakes it just seems to me that for an auditing company to fail to notice and report on the fact that a large investment company is, in fact, a shell game, is a sign that they aren't very good at their job. You might even suggest that they aren't worth $90,000/day. On the other hand, perhaps the federal Tories are just following the example of Mayor Rob Ford, who hired KPMG to provide a similar audit of Toronto finances, even though KPMG's most notable success is its string of failures, frauds and lost law suits.

And if you think that it stops at the Canada-US border, you'd be wrong. In fact, just last week the Securities & Exchange Commission (SEC) in the US filed a subpoena against the recalcitrant auditor, which has refused to cough up important documents to the federal regulatory body.

DTT was the auditor of China's infamous alleged fraud Longtop Financial Technologies (LFT)-- a software firm that sells its product to firms in the banking and insurance sectors in China.

This refusal might lead one to suspect that Deloitte is worried about being exposed for fraudulent accounting practices on behalf of the company that contracted them. After all, Deloitte was forced to pony up $50 million in damages for their role in covering up the massive Adelphia scandal that saw the owners illegally and secretly loaning themselves money from company funds to the tune of billions. And in 2008 Deloitte also faced a $1 billion lawsuit by the liquidators of the Bear Stearns mortgage funds. Bear Stearns went belly up in March 2008, before Lehman Brothers followed suit in September, as a result of being loaded down with toxic debt from the subprime market, which it was also packaging and selling to anyone who would buy it.

The suit charges that the company, the fund managers, and Deloitte violated their fiduciary and professional duties. The suit said Deloitte's preparation of the funds' audits was "at a minimum negligent."

Back in Canada in the late 1990s and early 2000s, Deloitte was also called on the carpet for covering up the shabby state of finances at Livent, the entertainment company owned by Garth Drabinsky. Livent went belly up and the bankruptcy receiver launched a $450 million lawsuit against the auditors for reasons that will sound familiar.

The Post says the lawsuit alleges negligence, breach of duty, breach of fiduciary duty, and.or breach of contract on the part of Deloitte & Touche. Documents filed by the receiver reportedly claim Deloitte & Touche failed to uncover financial and accounting irregularities at Livent, and that Deloitte signed off on Livent financial statements that it knew were "materially false and misleading".

As shocking as this short list is, it isn't by any means exhaustive - there was Deloitte's role in AES, the electricity company that cooked its books with hidden loans a la Enron, or their role in helping to inflate the profit numbers at now-bankrupt telecom giant Nortel for which they also faced a lawsuit. All of which might lead you to ask yourself why the media has failed to pick up on any of this and, more importantly, why the federal government would hire an auditing firm with a record of aiding their clients in the commission of fraud, which sometimes - as in the Mount Real ponzi scheme - led to the loss of life savings by tens of thousands of ordinary people.

The media, of course, has their own reasons for perpetuating a memory hole, down which all history of past crimes disappears. But neither is it incompetence that the Tories would hire these crooks. Fraud and manipulation is exactly what they want from an auditing firm. As with the ratings agencies, auditors don't exist for the purpose of objective measurement of financial viability or good quality accounting practices. They are there to provide whatever their clients want. When the investment banks hired ratings agencies to look at their investment packages, they pronounced utterly worthless "collateralized debt obligations" as triple-A investments. When those same corrupt investors want governments to sell off state assets at fire sale prices - they downgrade state debt that has considerably more inherent value than the sub-prime crap or even the vastly larger private sector debt load. When failing companies want to cover up internal financial crises, auditors like Deloitte know how to cook the books. When governments want them to spin cuts as efficiencies, they know how to do that too. They are, in short, the most craven example of how math and business "science" are in fact nothing more than tools of the rich and powerful to screw the poor and powerless. And for that service - from the perspective of Tories and corporate CEOs - they are indeed worth $90,000 per day. From the perspective of the interests of the vast majority of the population they are crooks of a much greater magnitude than any bank robber. They ought to be shut down, their assets liquidated and their executives sent to the hoosegow for a very long time.

And, speaking of the role that auditors play on behalf of conservative governments which want to sell of assets, check out this video of Toronto Councillor Adam Vaughan grilling KPMG on their past record of recommending service privatizations:

Tuesday, September 20, 2011

There's an old saying that goes "fool me once, shame on you; fool me twice, shame on me". I'm not sure what the appropriate riposte is when you've been scammed by the same dishonest brokers a hundred times over. That sadly describes the behaviour of the Palestinian Authority who have gone along with the charade of negotiations and broken treaties so often that it's like watching reruns of a syndicated TV series - you know how every episode is going to end but you can't help but watch it anyway. Granted, the PA have often been duped not so much out of political cowardice or foolishness as a lack of alternatives. During the civil war in Lebanon in the early 1980s, the PLO were effectively defeated by the combined power of Lebanese fascists and Israeli military power and accepted a "peace agreement" that saw the Palestinian guerillas leave the country in return for a guarantee that Palestinian civilians would be protected. Within days the Israelis had facilitated a horrific massacre at the Sabra & Shatila refugee camps, carried out by the Israeli allied Lebanese falangists.

The same inability to mobilize sufficient levels of resistance during the first Intifada to defeat Israel - though enough to make Israel look like the child-murdering bastards that they are - led to the Oslo Accords. Oslo, lovingly pined after by squishy liberals everywhere as a way to avoid dealing honestly with Israel's racist colonialism while appearing sympathetic to an obviously oppressed people, was never anything other than an agreement to outsource the oppression and colonization to the Palestinians themselves. In return for suppressing resistance, the PLO would get authority at about the level of a municipal government, be allowed to fly the Palestinian flag, and Israel would even hand over tax dollars that were collected from and therefore legally belonged to the Palestinians. Israel would continue to build illegal settlements, kill Palestinians that the PLO, by then the Palestinian Authority, hadn't jailed or suppressed and, finally, chop up the West Bank with an Apartheid Wall and turn Gaza into a giant open-aired prison on the brink of starvation. Oslo, far from being the basis to establish a Palestinian state and end the conflict, was about neutering Palestinian resistance while continuing with the same genocidal policies.

That thoroughly dishonest, not to mention murderous, modus operandi has always been how Israel carried out its dirty deeds - claim to be under existential threat, plead a desire for peace, and then stage pre-emptive attacks on a people who have been disarmed by international conspiracy using the most advanced weapons on the planet, gifted to them by the most powerful empire in world history. When the oppressed fight back with stones and bottles filled with gasoline against heavily armoured tanks and sniper rifles with night vision or jet fighters flying at 10,000 feet, claim that this demonstrates the Palestinians are murderous, trained from birth to hate Jews, religious fanatics, etc. There is, in other words, "no partner for peace." How often did we hear that in the 1990s in relation to Yasser Arafat, even as he jailed oppositionists. That is, until Abbas finally stepped up and agreed to be a mini-Mubarak happily working on behalf of Israel's pantomime of being the USA in oppressing his own people even more profoundly. Then Arafat was no longer necessary and was conveniently disposed of.

This - and much more, frankly - is worth rehearsing as we hear Obama and Netanyahu pleading with Mahmoud Abbas not to bring the issue of recognizing Palestine as a state to the UN. Hilary Clinton even pretends to want to see a two-state solution and professes to be struggling to bring one about. Netanyahu has even offered direct negotiations. The only accurate words to describe this little charm offensive ought not to be used in polite company. Suffice to say that only an absolute moron with a profound memory disorder would fall for any of this. Obama had his chance to demonstrate having the Palestinians' interests at heart when Netanyahu accelerated the settlement building program and snubbed Obama's plea for a serious hiatus. Obama and the US government could have suspended the $3 billion in annual gift cash that Israel receives each year. They could have suspended the military aid and joint training exercises. They did nothing and not because of any Jewish/Israel lobby in Washington. They did nothing because of the vital role that Israel plays as America's loyal little Sparta, their watchdog in the Middle East, a bulwark against Arab democracy or any Arab dictator who gets delusions of anti-colonial grandeur. Or simply gets too big for his britches, as Saddam Hussein found out.

The trouble now for the Americans and the Israelis is that revolution is sweeping the region and all the old calculuses no longer hold. Just over a week ago Egyptians rioted outside of the Israeli embassy, forcing the embassy staff to flee for their lives. Turkey, emboldened by years of China-style economic growth, is flexing its muscles in the region and has threatened to send Turkish warships to accompany aid vessels going to Gaza. Turkey, with 74 million people and a modern economy and modern military is not so easy to push around as the disarmed Palestinians. Egypt, Israel's neighbour, is no longer under the thumb of a pro-Israel, pro-US dictator and everything, including the 35-year peace accord is now up in the air. The revolutionary wave has made Israel more isolated and the Palestinians more powerful than they have been in generations. And Abbas knows that. He also knows that the division between Hamas' controlled Gaza and the PLO controlled West Bank was a machination by the White House/Israel - one that he actively went along with, to be sure. But rather than cementing his rule and destroying his Hamas enemies, as it was meant to do, it weakened him, made him look like what he is - a comprador tool of Israel and the USA. All of this may have emboldened Abbas. Certainly he can't turn back now or he will be a corpse politically. He has nothing to lose - the Palestinians have nothing to lose - by pushing for a symbolic victory at the UN. Of course, the USA will - as they have promised - veto the Palestinian application in the Security Council. But at a time when the USA is trying to appear as the friend of the Arab Spring, this will seriously damage their image. And the world will see that the Palestinians have the support of the vast majority of countries. Israel will appear, again, as the molly-coddled bully boy of the Middle East, kept solvent and dangerous by their American benefactors. And there is yet a further danger. If the Americans and Israel publicly and actively stand up and say that Palestine isn't a country, there is every danger that the strategy of the "two-state solution" will be finally and completely dead; revealed as a façade behind which Israel could engage in endless, meaningless negotiations while creating "facts on the ground." If that leads to a civil rights struggle for a truly civil state - as opposed to the theocratic monstrosity that is Israel, the "Jewish state" - including calls for the right to democratic representation and an end to Apartheid-like policies, this will be very dangerous ground, especially in an era where everyone in the Middle East is engaging in the fight for democracy and freedom. If Abbas doesn't back down, this could open up a new round of struggle in Palestine that aligns it with a regional revolution. Palestine could truly join the Arab Spring. That can only end badly for Israel - and rightly so; they have sown the wind, it's about time for them to reap the whirlwind.

Monday, September 19, 2011

Ah, I love the smell of self-inflicted Tory panic on a Monday morning. It seemed only a year ago that things were heading towards Tories at all levels of government. Harper was riding high - and would soon win a majority - Ford won a majority of votes in the mayoral election, while the left candidate (can you even name him?) won less than 15%, and shiny, new provincial Tory leader Tim Hudak was going to crush Liberal Premier McGuinty like a badly matched UFC brawl.

What a difference a year makes.

Sure, Harper got his majority but he didn't really improve his vote. And the NDPs vote went through the roof, representing a big shift to the left, particularly in Quebec. After years of enduring Liberal sycophancy in the face of Tory policies - and Ignatieff's poor efforts as posing as a fighter - the arrival of the NDP will put much greater pressure on the Tories. It's worth noting that one of the first acts by the NDP was to challenge the Tory's punitive back to work legislation against the postal workers, who were locked out by management.

Here in Ontario Hudak's Tories were riding high as late as June, with projections that they could win up to 20 Toronto area seats. But it's been all downhill since then.

In a Forum Research poll from June, when the PCs were leading by a wide margin in Ontario as a whole, Mr. Hudak’s party stood at 33 per cent in Toronto, ahead of the Liberals (31 per cent) and the New Democrats (25 per cent). In a space of three months, the Tories have lost about one-quarter of their support in the province’s largest city.

The Tory meltdown has yet to gather the same kind of momentum in the rest of the province but there is a pattern emerging that hints at the potential to deal a serious hammer blow to the Tories in Canada's industrial heartland. A big defeat here would damage Harper's chances of repeating his majority next election and open the door to a potential NDP federal government.

It's certain that the key is bumbling Rob Ford's endless stream of screw-ups and the possibility of really putting a stop to his austerity agenda. As today's Globe & Mail points out, Ford is ready to back-off on library closings and eliminating daycare subsidies - even though he was still touting them as late as last Tuesday. This partial, humiliating climbdown is a result of the unprecedented outpouring of anger over the fact that Ford lied during his campaign that there would be no service cuts and his and his brother's shocking arrogance and cavalier attitude to popular public services. The solid campaign by the library workers union to publicize opposition to the cuts - and the recent massive Toronto poll that showed Ford's popularity in freefall with anti-cuts sentiment pushing 75% - have deepened the crisis at Ford HQ. Even mainstream newspapers and right wing radio hosts are laying the boots in.

The growing campaign against the cuts - including a recent mass meeting in Dufferin Grove Park that drew 600 - and the likelihood of a big demonstration on Monday, September 26 increases the possibility that we can push Ford from climbdown to meltdown. And a meltdown of the Ford administration will undermine the Hudak Conservatives in a big way. It will help to spread the anti-Tory sentiment beyond the city's boundaries, demonstrating an alternative to austerity and phoney calls to "respect taxpayers" - really code to coddle and subsidize the rich. All of which makes it that much more important that September 26 is massive. Spread the word, invite your friends and family, your co-workers, your neighbours and plan to be there yourself. This could be the moment we begin to turn the tide - and that's something that you don't want to miss.

Friday, September 16, 2011

If I were a betting man, I would have slapped down a c-note that Ford's administration would go off the rails within two years. Even during the election it was clear that Ford's buffoonish populism - attacks on public sector workers, combined with a pitch to fight gravy while not cutting services - could only lead him to trouble. It's not for nothing that the Toronto business class were stumping for George Smitherman, the smooth-talking, fancy-suit-wearing, downtown businessman. Smitherman had the chops to implement the agenda that the ruling class wanted - some cuts, sure, but just as much they wanted a stable operating environment. The situation in Toronto is not like Greece - all out class war is not needed to stop the city from tanking and while there is clearly a recession looming, it is not (yet) the case that they feel the need to really lay the boots in and risk the profit-damaging effects of both austerity and upheaval.

Enter Rob Ford.

The mayor's bombast, his heavy-handed, mob-like leadership style and the family compact way of running city hall, where his brother acts like the co-mayor, was accepted at first by most people and most councillors. After all, people voted for change and this was certainly a different style than Miller's "rational", "progressive" and consensus-building modus operandi. And councillors were cowed by the hype about "Ford Nation" - the supposed rush to small-minded, right wing populism by the inner suburbs of Toronto. But, the trouble with hype is that it only carries you so far and believing your own hype can be dangerous when it's past its sell-by date.

Ford's refusal to work with anybody outside of his inner circle - whether city unions or civil service elite - and his penchant for shooting from the hip on everything, even when he knows nothing about it, was destined to end in tears. Ford is an authoritarian leader without an authoritarian apparatus - or an authoritarian mood amongst the business sector - to do his bidding. Remember, the first thing that Ford did was cancel the Transit City plan that had been painstakingly constructed over a number of years, in consultation with not just environmental groups or, god help us, transit unions. It involved businesses and international transit experts. It's no secret that Toronto has a gridlock problem and an outdated transit infrastructure - highway traffic jams cost the Ontario economy over $1 billion a year. Business wants an upgrade. The population wants better transit services.

Ford wants the road system reserved exclusively for private cars. His solution, to build a privately funded subway system is a boondoggle. First off, let's remember that it was Ford's Tory buddies who buried (literally) the half-completed Eglinton subway line back in 1995. And not only does everyone know that subways cost way more than above-ground transit systems - like the LRT/dedicated streetcar lines planned for in Transit City - but Ford is re-discovering the reason why the capitalist state exists and it's not because communists tricked the population into setting it up. One of those reasons is to fund the infrastructure necessary for the economy because business doesn't want to. Sure, business will "donate" money to universities to get a $20 million building named after them and then write if off. A $4.7 billion subway line is another kettle of fish. Ford's Sheppard subway extension is going nowhere and I have a sneaking suspicion that Transit City will make a comeback in the next municipal election (if not sooner, depending on the outcome of the provincial election), along with the fact that the Ford's cancellation of it cost city taxpayers about $50 million.

But the unravelling of Ford's "dubious" subway plan is really just the tip of the iceberg that the good ship Ford is heading towards at full speed. Him and brother Doug's attempt to end run the longstanding Waterfront Toronto plan to revitalize the port lands was so ill-considered and silly - really, a mega mall and a ferris wheel on the waterfront? - and the method of bringing it into competition so sneaky and unprincipled that it was dead before council kook and Ford enforcer Giorgio Mammoliti could denounce opponents as inner-city communists. Of course the Waterfront Toronto plan is dominated by business interests and elite consultants, planners and the like. Of course it has taken ten years to get anything rolling. Of course the process has probably involved its own fair share of corruption. It's not that Waterfront Toronto is a model of democratic planning - it's that Ford's alternative is even more corrupt, more absurd and less appealing. And now it's coming undone with three of Ford's allies now saying that they'll vote against the plan.

We shouldn't kid ourselves that city councillors who backed Ford to get plum positions have suddenly seen the light, nor that the mushy middle and frankly mushy left have suddenly developed spines. The real reason that Ford's administration is heading towards a crisis, possibly a meltdown and even civil war within the Ford camp, is solely because of growing anger by ordinary people in Toronto. Ford's promises of no service cuts and no tax hikes - along with his destructive and embarrassing interventions into city projects like transit and the port lands - has disillusioned those who believed his lies. His refusal to set one foot near a Pride Toronto event - perhaps the city's biggest summer festival - has alienated even the centre-right who just saw it as rude and unnecessary. And the poll in today's Toronto Star that shows only 27% would vote for Ford if an election were held today, not to mention that 75% want their councillor to oppose Ford's cuts, will only deepen the sense of crisis at city hall.

The depth of that crisis and the growing likelihood that even the right wing is going to round on his administration, was made apparent when even a sycophant like Jerry Agar, the host of NewTalk 1010, went on the offensive during a Ford interview this week. Agar demanded to know where the missing "gravy" was that Ford promised to eliminate and Ford could only say that city employees were the gravy. Trying to cover for the fact that he is backtracking on his campaign against service cuts, Ford refused to use the word, instead using "efficiencies".

Challenged by Agar to say whether the elimination of daycare subsidies for 2,000 people would be a cut, Ford said, “No, it's an efficiency.”

The fallouts from loyal councillors and challenges by right wingers like Agar are a sign of unravelling. It contributes to the sense that things are off track, accelerated by the mayor's inability to shut his mouth every time something stupid comes to mind. This makes it a good time to ramp up the public mobilizations against Ford, to show people that there is an alternative and that they aren't alone in thinking that the Ford brothers are a disaster. Last weekend's mass meeting in Dufferin Grove Park, organized by Toronto Stop the Cuts drew over 600 people, demonstrating the potential that exists. And the September 26 rally at 5:30pm at City Hall is perfectly timed to deepen the Ford crisis and put a different vision on the agenda. If it can draw the same kind of crowd as the protest in April, which brought out 10,000, there will be more defections from and infighting within "Ford Nation". We need to accelerate the decay of the Ford administration before they do (more) serious damage to city services and working conditions. This is an opportunity not to be missed.

Thursday, September 15, 2011

Still recovering from some Toronto Film Festival fun and getting back to work but thought it worthy to post this little cultural tidbit. The first thing is that it's weird that a show contract and rider are being auctioned to a private bidder. It's truly fetishism of the highest order. Though I've stopped throwing out old socks and underwear on the unlikely chance that I'll ever be famous but a little short of cash ("Opening bids on Mr. Whitney's 2008 Calvin Klein boxer brief's with accompanying holes and stretched waist elastic will begin at $14,235). Semi-religious object obsessions aside, the rider from the Beatle's 1965 concert in Daly, California is nonetheless interesting for the fact that they have as a line item that they will not be expected to play any segregated concerts, still relatively common at the time. For those that think John Lennon just discovered progressive politics in 1970, this demonstrates that the four working class lads from Liverpool - a city with strong left and union traditions - were no johnny-come-latelies to being decent guys, even where it might have damaged their careers.

Monday, September 12, 2011

If you're reading this right now you are doing something that I have refused to do: read any coverage or analysis of 9/11. I am boycotting the wall to wall coverage - the pull-out specials in the newspapers, the live coverage of ceremonies at ground zero (I assume there are ceremonies but I haven't been reading the coverage so I can't be sure). I'm even ignoring the critical coverage that is buried underneath all of the jingoism, mourning, and replaying of buildings billowing smoke. After all, what else can be said about 9/11? We know there has been several wars since then - putatively because of 9/11 but, in fact, argued for, threatened and planned for prior to the event. Way back when, everybody was quoting the founding documents of the Project for a New American Century, which advocated war against Iraq (a secular government with no ties - and significant animosity - towards radical Islamism). When we memorialize 9/11 as the reason for those wars we're participating in that lie.

Ah, but there I go, trying to analyze it. The truth is, it's pointless because the event has been drained of any rationality. It has become an endlessly repeated image of those burning towers and the necessary repetition of appropriate regret for the loss of life. There is literally nothing to say that won't be banal and commonplace to those who accept your particular viewpoint of the significance of the day - and which won't be utter blasphemy to those who don't.

Not many would say that I try to avoid thinking about world events and politics. Something happens somewhere in the world and I try to dig up the historical roots and uncover the social forces at play. It's a bit of an obsession at times. But this one event I will let pass - not because it's so special that I need to look away from the horror. 35,000 children die every day from preventable causes. Preventable causes. 6 million Jews died in the Holocaust. Anywhere from hundreds of thousands to 1.2 million died in Iraq as a result of the war - not counting the US enforced sanctions for a decade prior to the war. Nor do I want to ignore 9/11 because it isn't important. Certainly to the 3,000 people killed, their friends and family, 9/11 was a calamitous event. But, just as obviously, it was calamitous to the people who have been killed in wars, the societies destroyed, by wars supposedly in retribution for 9/11 [re: supposedly - see Project for a New American Century above].

No, the reason I won't read about 9/11 - not a word: I caught myself reading Chomsky on the al Jazeera website and forced myself to stop - is because we have lived it for ten years. We have seen it all - and if we happen to live in Iraq, Afghanistan, Palestine (yes, they got blamed too - we rarely miss a chance to kick the Palestinians around), Pakistan we felt the self-righteous fury of its manufactured response. We have seen this extended to our civil liberties - eroded significantly, almost without protest. We have seen it in a more bellicose form of rhetoric from politicians and media figures and a greater ease of military response to every crisis - we now slip on our fatigues to go and bomb "evil-doers" as easily as we put on our Wellingtons when the rain comes. We all know what 9/11 means and I don't need a special edition of the New York Times or, God help me, Glenn Beck to explain it.

We don't need more memorials. They're building a "Freedom Tower" in New York with 104 floors of skyline-dominating memorial. All you have to do is say "9/11" and every person in the western world, and probably most of the eastern, southern and northern world, can't help but have the iconic image pop into their mind - even if they try to think of the CIA coup against Salvador Allende on September 11, 1973. Even in countries that have suffered much greater tragedies, which is most countries, it was probably on the front page at some point in the last week. Making this event the obsession of the entire planet is somehow deeply pathological, like a monomania as we try to find the right emotional response to an event we're expected to have an emotional response towards. Meanwhile the house is burning down. I hate that I even remembered "where I was when I heard about it" several times today; once at a film festival bbq where we were expected to stop noshing and shmoozing to pay our respects for the dead. No: no more memorials. Talk to me about 9/11 when, instead of verbiage and symbols - and guns and bombs and F-35 fighter jets that cost a ba-zillion dollars - the memorial that is being offered is a plan to eliminate poverty at home and abroad, to stop supporting dictatorships that are convenient and bombing ones that aren't (especially the democratic ones that we call dictatorships because we don't like how people voted). In the meantime, stop trying to prove how profoundly on top of the meaning of the event you are in order to sell newspapers (how much extra has the New York Times made selling it's coverage - like to the T.O. Star?) or get people to tune in. It's like Christmas Day when no matter which channel you turn to you get people singing Christmas carols or delivering sermons. Just. Stop. Already.

Saturday, September 10, 2011

It seems apparent that European politicians somehow missed out the economics class where they explain how massive cuts to public spending in the middle of an economic contraction makes things worse. They also missed the one about how simultaneous across-the-board austerity can cause resistance to spread from sector to sector and country to country, leading to a generalized revolt that could further destabilize profit-making.

Well, if they missed those classes while they were working on their MBAs, they're certainly learning those lessons now.

From Greece to Italy to Spain to Britain, the resistance to austerity is heating up. With meetings and protests and flash mobs happening this month in Toronto to try and halt our own austerity-loving mayor, it's worth seeing that this struggle isn't one that's isolated to us but is global in scope. If they can win in one country, it can inspire people in another country, which can lead to a domino-effect of anti-austerity struggles.

Perhaps the highest point of anti-austerity struggle is in Greece, which has now been feeling the hammer blows of massive cuts and attacks on jobs and pensions for well over a year. After a recent series of general strikes and battles with the police the government managed to pass a second round of austerity cuts through parliament. It seemed like they had won but students clearly thought otherwise. There are now something like 200 universities under occupation against government plans to not only bring the private sector into public education but to also attack and limit democracy on campus. This is a very important symbol in Greece, where the campuses led the fight against the Greek dictatorship in the 1970s. Since that time police have not been allowed to enter campuses without special permission from elected councils on campus. There is a big demonstration on September 8 that will include teachers from primary and secondary schools who will join the occupations in solidarity.

In Italy, Berlusconi has just voted through a massive austerity package worth $70 billion. Some of the unions in Italy have accepted that "there is no alternative" but the largest union in the country, the CGIL, called a general strike on the day that the austerity package was voted on. Up to 3 million people took part with 70,000 demonstrating in Rome and tens of thousands more taking to the streets around the country.

On Tuesday in Spain there was a protest strike and a demonstration by up to 25,000 in Madrid against a constitutional amendment that forbids budget deficits except in "emergencies". Spain has seen a protest movement, called Los Indignados (the Indignant) that exploded onto the scene in early summer, taking over public squares across the country in imitation of the Arab Spring across the Mediterranean. That movement seems to have subsided somewhat but hopefully this protest action by unions signals that it has spread into the previously acquiescent union movement.

In Britain, things are moving slowly towards a boil. Last fall there was a huge explosion of student protests and strikes against the tripling of university fees. The energy and anger of that movement spurred the union leadership - which had organized nothing to resist the Tories - into action. First there was a protest by hundreds of thousands of trade unionists and supporters in March. Then a number of unions held a coordinated one day strike in the summer, involving up to 750,000 workers. Now this fall is set to see some big protests - in Scotland, and at the Tory and Lib Dem conventions (they govern together in a coalition) - followed by an even bigger coordinated strike in November. The issue that has galvanized industrial action has been pension and this round of strike action could involve up to three million workers. This will be the biggest industrial action in Britain in decades.

A breakthrough in any of these countries could easily spur the growth of struggles in other countries. And, as Greece shows, a temporary victory by the politicians and bankers doesn't necessarily spell the end of the struggle, merely shifting it to another terrain. Here at home, we have our own opportunity to take on "austerity flu" on September 26 at Nathan Phillips Square at 5pm. Make the effort to be there - be part of an international movement for a better world.

Friday, September 9, 2011

Watching the Ontario election you'd think that there was nothing of much import going on in the world. Why else would there be so little difference in the platforms of the three major parties in this election? For instance, you'd never know that a majority of Ontario's workers live pay cheque to pay cheque with 40% expecting that they will have to retire later than they had planned.

A major contributing factor to the low savings rate [i.e. retirement savings - rbh] is that many Canadians are living close to the line. The CPA survey found that the majority of Canadian workers continue to live pay cheque to pay cheque, with 57% saying they would be in financial difficulty if their pay was delayed by even a week.
The numbers were even higher for younger Canadians aged 18 to 34 (63%) and single parents (74%). The regions with the highest percentage of workers living pay cheque to pay cheque were Ontario (60%) and the Atlantic provinces (64%), which may be the result of their slower recovery since the last recession.
Financial planners generally recommend that people have approximately three months of expenses (rent, mortgage, bills, groceries, etc.) as an emergency fund.

How is it that this fact never gets mentioned? We know why the Tories never mention it - because they helped contribute to it. Ditto the Liberals, particularly at the federal level. But why hasn't the NDP said a word about the decline in living standards amongst working people? We can get some idea from the present media onslaught on the legacy of the Bob Rae government in Ontario. Federal NDP president - and leadership hopeful - Brian Topp made sure to take a dig at Bob Rae this week, contrasting the Ontario NDP government with the "successful" governments in Manitoba and Saskatchewan. And Andrea Horwath made a point of attacking the government of Bob Rae in the early 1990s.

“I know there are probably many different opinions out there in this room about the NDP’s record in government. So I’m here to set that record straight. Contrary to what my opponents may tell you, New Democrats across Canada have a very good track record when it comes to managing books and balancing budgets,” Horwath said during comments at Mayor Jim Watson’s breakfast speakers series, which is held at City Hall by the Ottawa Chamber of Commerce and Ottawa Business Journal.
“I’ve got to say here, straight out: That not every NDP premier has had a stellar record. But since the premier with the absolute worst record is campaigning for another party nowadays, I am not going to take any lectures from my opponents,” Horwath said, laughing.

On the one hand, I'm loathe to defend Bob Rae for reasons that ought to be obvious. However, it is not at all for the same reasons as Horwath and Topp. The problem with the Rae government wasn't that it ran up a deficit trying to fight the recession of the early 1990s. In fact, I remember being impressed when Floyd Laughren, the then-finance minister, announced that with his 1991 budget he was faced with "fighting the deficit or fighting the recession - we're proud to be fighting the recession." Of course, the business media went insane, attacking Ontario's first labour government - Ontario's credit rating was downgraded and there were even bankers and businessmen demonstrating on the lawn at Queen's Park. Now, when Stephen Harper runs up a deficit nobody says boo. It was and is about a class war on Canada's party of the labour movement, an attempt to tame them into operating in the interests of the business class. So, when Horwath - who was supposedly the "left" candidate for ONDP leader - and Brian Topp laud the governments of Saskatchewan, Manitoba and Nova Scotia, what they are really celebrating is the fact that those governments capitulated utterly and completely to the agenda of big business. Oh, sure, they had some reforms here and there but, like the NDP in this election, their vision was so pathetic and pedestrian that business didn't need to protest - as long as they got the big picture right, which was to discipline the economy (i.e. the working class) and to orient towards business profits.

One look at Horwath's policy platform reveals just how low the NDP has set its sights. Whereas Rae's "Agenda for People" election platform called for nationalizing auto insurance, legislation to prevent the use of replacement workers (scabs) during strikes, better social assistance, and tax reform - Horwath's "Plan for Affordable Change" offers very minor reforms like reducing the use of consultants, forcing the government to buy Ontario goods, freezing transit fares and cutting HST on home heating. Not only is this basically indistinguishable from the Liberal platform - in fact, the Liberal platform appears more bold, promising 50,000 green energy jobs compared to the NDP's plan of creating jobs with a "buy Ontario" law - it appears on the surface to be indistinguishable from the Tories' platform. Our choices in the election have been reduced to a choice between brands rather than any substantive difference in political direction. Even the possibility that there might be a voice for something off-message needs to be stomped out - as we've seen this past week with the Ontario NDP's overturning of the democratic election by the riding association in Thornhill to run well-known socialist Barry Weisleder as the riding's candidate.

All of this speaks to the collapse of post-war social democracy into neo-liberalism - which is precisely what Bob Rae's government represented. Elected on a - by today's standards - bold platform of reform, by the end of their term the NDP government had firmly laid the groundwork for the Tories. They attacked public sector workers with a "Social Contract" that imposed unpaid work days. They demonized welfare recipients and began the war on the poor that Mike Harris took up in earnest. They eliminated grants for poor students attending post-secondary education. And they completely capitulated on public auto insurance, making it the last time that a serious proposal for nationalization would cross the lips of an NDP leader (not quite true - Horwath is talking about re-merging the Ontario hydro utilities and keeping big electricity producers publicly owned). By the end of their tenure, the majority government of the NDP couldn't even pass same sex spousal legislation, which wouldn't have cost the government a dime. Disappointment, betrayal and cowardice in the face of right wing, business opposition ought to be viewed as the mistakes of the Bob Rae years. The lesson ought not to be that we need to surrender having a big vision for a better society. If the point isn't to change the world, what's the point in having an NDP? If we accept that there is nothing we can do in the face of autocratic corporate power, what's the point of elections? My guess is that many people are asking themselves similar questions during this election campaign - or, perhaps more likely, they're just bored.

Thursday, September 8, 2011

Ophelia by John Everett Millais, founder of the Pre-Raphaelite Brotherhood

In the first part, we discussed how primitivist body decor is driven by the anti-modern impulse to restore something that has been lost - a sense of purpose and organic connection to a community - and that this was perhaps first articulated by the British conservative Sir Edmund Burke. But if Burke was the first to note the emptiness of capitalist commodity relations, he was certainly not the last to harken back to a more integral past. There thus arose with each generation a new attempt to recapture what was being lost, to preserve the deeper sense of meaning of the old traditions, to find something that was untainted by the modern drive to reduce everything to commerce. In art this led to the Pre-Raphaelite Brotherhood in the mid-19th century - a movement that sought to return art to the romantic forms and ideals of an earlier period. This bled into the Arts & Crafts Movement, whose most pre-eminent exponent was the designer William Morris. The ACM spurned machine manufacture of furniture and designs, instead valorizing the ideals of handicrafts. Morris ultimately became a Marxist and quite critical of the ACM, since it was only the very wealthy who could afford to "reject" the modern manufacture methods. Many of the other recognizable forms of anti-modernism were born in the period of the late 19th century and are still recognizable to us today - Aleister Crowley and modern paganism, gardening, do-it-yourself movement, military/chivalry and outdoorsy hobbies like camping, the boy scouts, even tourism - particularly the spiritual tourism made popular since the 1960s, et al.

All of these "movements" were rooted in the sense that there was something empty in modern society's obsession with turning everything into an object for sale. The drive to feel something of the traditional organic connection to the world and to one's body emerged out of the disconnection - the alienation - that people increasingly felt from the world around them. Where once we were connected to the soil and the turning of the seasons and the product of our labours ended up directly in our hands, we now worked for someone else to serve distant economic forces that we could only dimly understand. And the products of our labours were taken from us and, instead, we were given abstractions - pieces of paper that could be exchanged for goods that we played no part in creating. This was a profound change for people in the 19th century, most of whom lived in recent memory, or still retained one foot, of the old ways of doing things. That alienation has deepened radically since the days of the pre-Raphaelites and the Arts & Crafts Movement. Everything that we consume is mediated through commodities, even where we put our own labour into it to complete it - whether it is assembling a piece of furniture from IKEA or buying the manufactured products from Home Depot that we will assemble into a new bathroom or shed. With our further removal from any organic connection, the radical alienation inevitably creates a profound longing for "authentic experience".

For some the only way to restore a sense of connection to a body that threatens to be dissolved in soulless economic relations is to violently seize control of the body, to hurt it as an affirmation of its existence. But if it is not just to be mere "cutting", which also appears as meaningless sensation, the obvious (though not the only) choice to engage in this "reconnection" is through forms that have a primitive resonance - sometimes resonating with the distant past of Maori or indigenous tattoo designs, and sometimes even the far more recent "naive" images of an earlier time in the 20th century, such as retro tattoos of mermaids or pin-up girls. That which is past denotes a rejection of modern manufacture with it's pre-package and mass directed homogeneity. It is an affirmation of the authenticity of the past when what people wore and experienced was inseparable from their lived experience.

A third element to the body decor movement revolves around the desire for community. Part of the experience of modern alienation is our sense of isolation from our fellow humans. Most North Americans and Europeans live in suburbs in which we have no integral connection to the people who live around us. Even as recent as the early part of the 20th century, before cars became widely available, people tended to live close to their work so their neighbours often were also their co-workers. As older forms of social bonds were breaking down, like the extended family living in one house, this still allowed there to be a more organic connection to the people in your direct vicinity. But today it is very unlikely that we work with our neighbours. Often we never even know their names or socialize with them beyond the occasional conversation across the backyard fence or in the laundry room of our apartment. This geographic atomization exacerbates that other trait of capitalism: to make all other people competitors for socially limited resources. We fear the people who will "take our jobs", whether they are foreigners or the population of the next city, which offers lower taxes. And we rightly feel a constant sense of suspicion that we are at risk of being ripped off - not to mention the more recent political tool of crime hysteria that has no basis in real crime statistics but serves a real social purpose.

But humans are profoundly social beings. Consciousness itself is the product of social intercourse and doesn't become possible until the evolution of language reaches a certain point. Language, obviously, assumes a community of shared experience that forms its foundation. It is no surprise then that humans who are isolated for long periods of time go mad - social experience is fundamental to our nature. The creation of a new identity on the basis of extensive and "extreme" body decor creates the conditions for a sub-cultural community. Thus the tattooed, pierced freaks constitute an identifiable group of people who can connect with one another on the basis of their differentiation from social norms in general and with a longing for authentic and primitive rituals and body decoration. The body alteration and the mirroring of various forms public, primitive and/or ascetic ritual provides a sense of relief from the atomization and alienation that is modern life.

A hipster ritual?

And, yet, ultimately body modification fails to resolve the systemic problems that give rise to it for the simple reason that it fails to alter those social relations. What's more, it participates in those social relations and is potentially - and without much ado - incorporated into the system. Twenty or thirty years ago tattoos were avant garde and taboo. They were seen as the markings of criminality or lower class identity - or perhaps something foreign and dangerous. They certainly weren't mainstream. Nor were men with pierced ears. And when they were pierced there was a real danger, much discussed in the 1970s and early 80s, that you would pierce the wrong ear (I believe it was the right ear, though we believed that it was the left ear in Quebec) and be advertising yourself as gay. A simple, single piercing put you on the borderline of what was then an even more "deviant" identity than today. Yet now these things are commonplace - tattoos, including tribal designs, are everywhere. Large numbers of men have their ears, nose and lips pierced. The border between acceptable body decor has shifted. This is for the simple reason that capitalism can - as the Marxist cultural theorist Terry Eagleton put it - incorporate anything except its own political defeat. Capitalism may need certain subsidiary political forms to sustain its smooth running - racism to justify imperialism and differential wages, sexism to reinforce the privatized family, etc. - but most other social forms are mutable. Capitalism can live without them or, even better, can find a way to make money off of them. Yesterday the full sleeve arm tattoo was edgy, today it is implanted horns and facial tattoos or decorative scarring.

A Hindu ritual.

In some ways the present subculture of body modification is the bastard child of the 1960s. One of the many expressions of that period of international upheaval was a strong strain of anti-modernism, as well as a strong cultural identification with the recently decolonized parts of the world - India, Cuba, Africa, etc. When the cultural expression of that identification - setting up ashrams and communes in North America, following a yogi/eastern spiritual guide, adopting international fashion, etc - was a side-product of the political solidarity, it could be a distraction at worst and a symbol of solidarity at best. But now that those movements have long since receded and decolonization is now post-colonialist re-incorporation into the international system of capitalism, with its attendant corruption and division of labour, the cultural identification with non-modern or pre-modern societies lacks almost all social or political content. It becomes merely another form of cultural utopianism - a desire for the integration of the pre-modern world without the means to achieve it. So, the pagan dances to the new moon and then returns to his/her apartment in the city where they don't grow their own food but, rather, buy it and work a job where they are exploited like every other worker. The piercing and suspension aficionado hangs from hooks or wears gear that causes them to be pierced over their entire body - but the experience is about individual experience not very different from bungie jumping rather than being about affirming the values of the community using symbolic language that makes sense to the community in terms of its day to day social & ecological relations.

While there is something fascinating and worthwhile in a lot of body modification, it ultimately fails to achieve the goals it sets for itself - to overcome alienation, atomization and the cultural degradation of capitalist social relations. Instead, like all past anti-modernist movements, as William Morris discovered, the spiritual and cultural revolt from capitalism is reincorporated, becoming another commodity for purchase, displayed at conventions that charge entry fees and where the more money you have, the better the tattoo artist you can hire. It can even take the nascent revolt desired by many practitioners of body modification and not only turn it trivial - it also can lead people into a form of self-isolation from the mainstream. Yet, ultimately it is only by convincing and mobilizing the mainstream against the depredations of capitalism that there is the possibility of regaining the lost experience of authenticity, totality and integral connection to a broader community of purpose and shared experience. At its worst, primitivism can even become an ideological component of odious, far right politics, with their emphasis on blood and tradition and ritual, something that Adolph Hitler certainly never forgot. By all means pierce and tattoo away - I have several earrings and a visible tattoo on my forearm. But be aware that you aren't really a rebel, just another customer in a specialty shop.